Anahuac drowning in budget and water woes

City is on the verge of bankruptcy

Updated 12:11 am, Monday, July 23, 2012

Photo: Melissa Phillip

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Scott Wible is the city of Anahuac water treatment plant operator. The city cannot reopen the plant until it is rehabilitated, and it is buying water, at an increased rate, from Trinity Bay Conservation District.

Scott Wible is the city of Anahuac water treatment plant operator. The city cannot reopen the plant until it is rehabilitated, and it is buying water, at an increased rate, from Trinity Bay Conservation

ANAHUAC - This Chambers County seat, with its historic buildings and old courthouse nestled on the Trinity River banks east of Houston, is known as the spot where Texas began its fight for independence in the 1800s.

The quiet town of 2,300, where the first shots rang out against Mexico's oppression, has since been called the state's "cradle of independence." It's also been dubbed Texas' "alligator capital" for its annual festival that celebrates an abundance of this reptile and other wildlife that make their home here.

But now the town is wrestling with an entirely new image - as one of the financially distressed cities in America on the brink of bankruptcy.

Anahuac's city leaders, however, are determined to work their way through their debt crisis. They don't believe they'll resort to draconian austerity measures or the actual filing for bankruptcy protection as others have done in California and Michigan.

"I hope we're not hitting the wall like a lot of these other cities," said Anahuac's newly elected mayor, Cheryl Sanders, who has a fighting pioneer attitude. "There is nothing we can't overcome, and we're determined to do it."

The editor of the town's century-old newspaper, The Progress, Dayna Haynes, has heard rumblings that bankruptcy or disbanding the municipality by "disincorporation" might be the solution. "But I don't think people really want that," she said. "Someone would have to prove to me that there would be no bad fallout."

Only a few other Texas cities have taken the rare step to dissolve their town governments: Crystal Beach on the Bolivar Peninsula in 1989 and Chateau Woods in Montgomery County in 1993. Simonton voters in Fort Bend County defeated a disannexation vote in 2005.

Windfall whittled away

Both Anahuac's current mayor and a former mayor for 10 years, Guy Robert Jackson, oppose dismantling their hometown that incorporated 60 years ago.

"All the town's assets, like the water and sewer lines, would be sold to the highest bidder and they could charge sky high rates," Jackson said. "Plus citizens would individually be assessed any remaining debt that needed to be repaid."

He is baffled by how quickly the city plummeted into debt after he left office two years ago. He said it still had $1.2 million in cash reserves when his term was over.

Today the council is unsure exactly how much debt has accumulated, but Sanders is working diligently with other members to compile records for a new budget.

However, last month, city officials acknowledged that they had completely drained their savings accounts and had to delay paying $430,000 in outstanding bills.

Councilman Danny Thompson said the council did not learn of the city's precarious situation until six months ago. He and Sanders said then-city administrator Lance Nauman had not properly kept them informed.

Nauman, who resigned July 7, could not be reached for comment.

The city's finances started evaporating after its water plant broke down in October 2010 after Jackson left office.

In an emergency move, the city made a deal with the Trinity Bay Conservation District to supply water to its citizens. The district's administrator, Jerry Shadden, said he provided the water below his cost for eight months but then began charging his normal bulk rate (quadruple the previous cost) when the city failed to finalize a long-term contract with him.

At that point, the city believed it had found a cheaper way to go with portable equipment with a company called "Rain for Rent." But Sanders said this water wound up costing more than twice what they thought and the city has since returned to the Trinity Bay district.

"Just like Greece"

Complicating things further, Shadden said the Chambers-Liberty Counties Navigation District that supplies his raw water has recently sent him a proposal that would triple his existing costs and would force his rates even higher.

If Anahuac moves forward with plans to contract for water from Trinity for the next three years until grant money can be used to repair its old plant, Anahuac residents' water rates could increase as much as eight-fold, officials said.

Sanders said the city "must stop the bleeding" - since citizens are not paying even close to what it costs the city for water.

"I think we're just like Greece and Spain now," Jackson said. "Maybe we need to take some drastic measures like reduce all the employees, who aren't certified in something, to minimum wage like the mayor did in Scranton, Pa."

Water complaints

Sanders said the city has already whittled down to 11 employees and is not replacing the administrator's post. "We're doing his job ourselves," she said.

Meanwhile, many Anahuac residents complain that they are already paying too much for their water and can't even drink it.

"The bottled water is sailing off our shelves," said Debbie Copper, longtime manager of Hill's Grocery. "Lot of people are on a fixed income and complain their rates are already too high."

She complains that the water often has a rusty color and others complain about numerous "boil water" orders because the water pressure gets low.

"The water has been a little better lately. But sometimes you got to chew it, so I don't drink it," said Mary Raley, after filling up a plastic pool for her 5-year-old grandson.

A customer at the Family Dollar store, Kay Broadway, said, "It's like so many other towns who are getting in trouble. Somebody's not managing things."

But Sanders said citizens had to persuade her to run for mayor last election.

"It's a thankless job nobody wants," she said. "But we intend to pay our debts. We do not want to declare bankruptcy."